All in the details....
Chapter 11 of the Federal bankruptcy code is used by some companies, who for a short/medium period, find that their cash flow is not presently sufficient to cover all expenses. The law allows a bankruptcy judge to re-schedule payments to creditors so that the company can re-organize and regain profitable operations. To file Ch. 11 does NOT necessarally mean that the company is bankrupt...in fact it has been used in the past with companies whose assets substantially exceed liabilities.
At least that was the intension of the law.
It HAS on occasion been used by those in the know to squeeze concessions out of labor, in order to line their own pockets...something for which the law was not intended.
In the present economic climate, some air carriers, whose management have made very fundimental mistakes will find that the going is tough indeed. In many of these companies, the outright greed of pilot/mechanics/cabin crew unions has certainly NOT helped the financial picture.
Time to pay the piper....and it ain't gonna be pretty.